Assuming it is a purchase mortgage, your lender is correct.The disconnect is probably from reading about refinances and/or old pre-recession info and/or reading that you can roll some of the closing costs into a higher interest rate (but not loan amount).

There is certainly a large supply in Old Northeast but none appear to be for sale.

It's a duplex and needs a bunch of updating to take it out of the 70's...old windows, fake marble bathroom panels, plywood in 2 rooms for floors, etc. 

Is there a world where there are any benefits?

You also see some that have sheet vinyl flooring and old painted cabinets. 

Starting a new lease for small house with old  w/d  in basement . 

I’m just not going to work 9-5 everyday until I’m 75 years old.

Plus it is so old it does not have separate meters for electricity.

Hi, I'm new in the real estate world. 

@John Hyun welcome to the wonderful world of leverage!